Does Government Support for Innovation Matter? The Effectiveness of Public Support for Private Innovation

Project description

The aim of the project is to analyze in a comparative perspective the government support for innovation in form of instruments of financial support for innovation in Turkey and Poland, and to assess their effectiveness by applying recent econometric techniques (a CDM model) to firm-level data from the last three runs of the Community Innovation Survey (CIS).
While in economic theory there is a strong case for the public support of innovation and R&D activities of the firms, the experience many governments have made suggest that the success of such actions hinges on several conditions, of which a key one is a favorable institutional and governance situation, in particular transparency in project selection process for government support. Both countries are comparable in many respects (economic and technological development, a history of market-oriented reforms) and yet obviously quite different (also with respect to the R&D policy pursued in recent years), therefore there is considerable potential for a comparative analysis and policy implications which will be relevant not only for Turkey and Poland, but also for other developing or catching-up countries that aim at building a knowledge-based economy.

Project Structure and Involvement of CASE

As for the division of labour, both teams are going to follow largely the same agenda: first a review of policy instruments (under the responsibility of CASE), secondly process of building the econometric model performed by both institutes under the responsibility of TEKPOL. Finally the CASE team will be responsible for the editing the policy conclusions based on the research results.

Project Output

The main project output will be in the form of a report reviewing the policy instruments in both countries, outlining the modeling approach and, results of the econometric analysis as well as policy implications. The report will appear in CASE Network Studies. We plan to submit a shorter version of this work to an academic journal. The second key project output will be a policy brief focusing on the most important policy implications stemming from our research and targeted at a wide audience of policy makers, analysts, advisors, and general public and the media. The policy brief would appear in CASE Network E-briefs.

Partners: METU Science and Technology Policies Research Center (TEKPOL)

Sponsor: FEMISE